What does Seattle do with MFTE Rents?

On April 24, the United States Department of Housing and Urban Development (HUD) published the 2019 Median Income schedules which set limits for certain housing assistance programs in the country. For Washington, "Median Income" increased 6.4% from $81,100 to $86,300 per year. HUD has published "Median Income" for every county in the state, which can be found here.

For most cities with an MFTE program, the jurisdiction increases rent in the program in a consistent manner according to a prescribed schedule.

Seattle has taken a different approach. You may recall in 2018 after HUD published the 2018 Median Income schedules, the City of Seattle initially froze rent in the MFTE and other housing programs administered by the Seattle Office of Housing. Subsequently, the city manipulated the formula to decrease the maximum allowable rent in programs like MFTE. As such, instead of a 7.7% rent increase in 2018, which would have mirrored both historical practices of calculating maximum rent increases and actual median income increases, the city chose to use the "Low-Income (80%) Limit" published in the same schedule. This resulted in a maximum 4.49% increase in rents. Because of the manner in which HUD calculates rents, initially many thought the maximum allowable rent increase was closer to 11.5%. Of primary concern to the city in manipulating the maximum rent calculation was the large year-over-year rent increases in the city administered affordable housing programs (2017 resulted in 6.31% increase in affordable housing programs).

Fast forward to 2019.

In the Seattle-Bellevue Metropolitan Area median income increased by a little more than 5% from 2018 to 2019 while HUD's Low-Income (80%) Limit increased by 9.97%.

Like last year, the increase in the Low-Income Limit is significant and outpaces median income growth in the City of Seattle.

What does the city do?

The city ostensibly is in a difficult position because they manipulated the method of calculation for affordable housing programs last year without looking at the long game. This has resulted in the possibility of a HUGE rent increase in the affordable housing programs in 2019. No matter how you slice it, the rent increase in the program exceeds 8%.

The city has committed to updating maximum rent in the MFTE program and other city administered affordable housing programs by May 24. We shall see...

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Washington Multi-Family Housing Association is the Washington State chapter of the National Apartment Association. We are a collection of over 145 Property Management companies and owners of multifamily properties, with 1,375 apartment communities representing 225,000 apartment homes, and 250 industry supplier companies. We work together to promote and enrich the multifamily housing industry in our state.